“For much of the 20th century, Myanmar largely missed out on the spectacular growth seen across most of the global economy and, most recently, in its Asian peers,” Richard Dobbs, a McKinsey director, wrote in the report. “It now has the potential to be one of the fastest-growing economies in emerging Asia.”

Multinational companies will have to move quickly to be among the first to establish lasting business relationships and build market share into a leadership position in Myanmar, according to the report. However, companies should also be prepared to make a long-term commitment to the country by developing its business environment and training its growing workforce, the report said.

Myanmar’s potential for growth is clear. The nation’s natural resources include oil, gas, minerals, timber, hydropower and coal. Its population of 60 million sits right in the middle of Southeast Asia, perfectly positioned for access to the huge markets of China and India.

The report authors contend that the country’s early stage of economic development gives it a “greenfield” advantage—an opportunity to build a “fit for purpose” economy to suit the modern world.

That includes not being weighed down by legacy infrastructure.

“Myanmar is coming of age in the digital era,” the report states. “If it uses technology fully and innovatively, in banking, government, health care, agriculture, education and retail, Myanmar could leapfrog interim development phases to become one of the world’s fastest-growing economies.”

According to the institute, the nation’s growth will be driven by a few sectors: energy and mining, agriculture, manufacturing and infrastructure. Together they account for more than 85 percent of the country’s total economic potential. Myanmar’s low labor costs in these sectors could catch the eye of companies interested in relocating because of rising wages in their economies.

Myanmar’s consumer class would then grow as workers’ incomes increase.

“As the number of consumers with income for discretionary spending potentially rises from 2.5 million today to 19 million in 2030, consumer spending could triple from $35 billion to $100 billion,” the report’s authors predict.

Getting There Won’t Be Easy

Myanmar’s potential is great—but so are the challenges.

Despite the country’s economic promise since decades of military dictatorship and isolation gave way to a civilian government in 2011, many multinationals have taken only cautious, tentative steps into the market, remaining hesitant to make big investments, the report states.

The nation’s gross domestic product is currently less than 1 percent of Asia’s gross domestic product. Labor productivity in Myanmar is 70 percent lower than in other countries in the region, and the population has an average of four years of schooling. Moreover, Myanmar has grappled with sectarian violence between majority Buddhists and minority Muslims, which again erupted in May 2013. The government has also faced criticism by human-rights groups over the treatment of Muslims.

To be competitive globally, Myanmar’s business community would have to make changes and adapt. These changes would include rapidly reaching international standards of quality and price for goods and services and forging partnerships with foreign companies to take advantage of capital and knowledge and to connect with global supply chains.

Multinationals are looking at different considerations. Their approach needs to be “sufficiently detailed, with a high level of agility and adaptability” to prosper in a fragmented market of 135 ethnic groups, few population centers and limited infrastructure connections.

“Partnering with local companies could provide a platform for more rapid growth and improved access to local talent,” the report said.

Future success depends on whether Myanmar’s fledgling democracy can maintain political stability and continue with economic reforms. “To support this higher growth rate, Myanmar has to get all the fundamentals right—political and macroeconomic stability, the rule of law, and enablers such as skills and infrastructure.”